Everything You Have to Know About Large Cash Payments to Your Business
Many small business owners are completely unaware they are breaking the law once they accept cash payments over $10,000. What they don’t know may cost them huge fines by the IRS. Under IRS guidelines, if a business accepts a cash payment of $10,000 or more for a single transaction, they must report it by filing a form 8300 within 15 days of the transaction. This form can be filed online or on paper. Moreover, the business is required to notify the individual from whom they admitted that the payment no later than January 31 of the year after the filing.
The penalties for not filing could be huge. The intentional disregard penalty for failure to report would be that the greater of $25,000 or the amount of money received in this transaction to not exceed $100,000. Failure to file a timely return can run $50 to $100 per transaction.
Breaking a transaction into two payments does not enable you to prevent filing. The IRS counts more than one payment connected to one transaction as still being subject to the $10,000 limitation. For example, if a business sold a tractor and obtained a $7,000 cash deposit on the order, 소액결제 현금화 방법 delivered the Highway some time afterwards and received the $5,000 balance as cash, which would be counted as a $12,000 transaction and requires the filing of a form 8300. It’s not required to report transactions using cashiers checks or money orders, but any form of money or coin is subject to the limitations.
When a business sells a client a product for $9,000 money one month and a month later the exact same customer purchases an entirely different item for cash, that’s considered two distinct transactions and not subject to filing. But if the 2 sales occurred within a 24 hour period they’d be subject to the limitation. In case a business leases a space to someone who pays $2,000 per month rent in money and the entire cash rent paid during a calendar year exceeds $10,000, then that’s subject to the limitation since it’s all related to one transaction.
It gets rather tricky sometimes to ascertain when the limit was exceeded. If consult your accountant or the IRS site for further definition, or you can call the IRS for information. Form 8300 can be obtained online or wherever you purchase IRS forms. It can also be filed electronically online. Be careful to always report these transactions within 15 days.